Democrat Gina Raimondo won a tight victory in Rhode Island Tuesday against her Republican opponent, Allan Fung, and will serve as the state’s next governor.
With 95.7 percent of precints reporting, Raimomdo has 39.78 percent of the vote over Fung’s 36.83 percent, and the Associated Press has called the race for Raimondo.
Both Both Michelle and Barack Obama stumped for Raimondo in the closing days of her campaign, and Mitt Romney campaigned for Fung, who ran on his record of tax cuts and as mayor of Cranston, R.I.
Raimondo has led her Republican challenger, Allan Fung, in every major poll leading up to the race, and her win is not surprising in a deep-blue state. But her role in an aggressive overhaul of the state’s pension system ticked off public unions and played a big role in the tight race.
After she spearheaded legislation that raised the retirement age, suspended cost-of-living adjustments until the fund is 80 percent funded, and added defined contribution elements to retiree’s plans, public unions sued, and many rank-and-file members threw their support behind Fung.
Fung also reformed the pension system in Cranston, R.I. as mayor, and has said he supports right-to-work laws– but he’s also made it clear he’d give unions a seat at the table. Raimondo didn’t bother to consult the unions when she convinced the legislature to take on the sweeping reforms.
Rhode Island’s unfunded liabilities have been cut in half following the reforms, although some have criticized Raimondo for incorporating Wall Street investments into the state’s portfolio.
The hedge, private equity and capital venture funds are politically shady, since Raimondo used to manage one of them. But they’re not paying off, and the expensive fund continues to perform below the national average, The New York Times reported. That could end up costing the state $372 million in potential returns.
As a result, she’s in the strange position of being criticized by unions and favored by Wall Street. An October WPRI-TV/The Providence Journal poll showed Fung ahead of her among union members, 42 to 30 percent. She is otherwise fiscally conservative: She doesn’t support tax increases, because additional funds could be found in dollars currently mismanaged by the state.
The Wall Street Journal lauded her policies and victory over union-backed Democrats in the primary in a recent editorial, saying it’s important that a Democrat who is willing to reform government can prosper.
Her win is a blow to public unions and could encourage Democrats and Republicans around the country to tackle their own struggling pension systems.
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